Order Set Aside When GSTR-2A Input Tax Credit is Ignored
In the case of M/s. Oasys Cybernetics Private Limited v. State Tax Officer, Chennai (W.P. No. 16224 of 2024, decided on July 9, 2024), the Hon’ble Madras High Court ruled that an order is invalid if the input tax credit (ITC) reflected in GSTR-2A is not considered during adjudication.
Case Overview
Facts:
- Petitioner: M/s. Oasys Cybernetics Private Limited.
- Issue: The petitioner challenged the order dated March 7, 2024, arguing that the tax authorities ignored the ITC reflected in GSTR-2A while determining tax liability.
Legal Issue:
Does an order remain valid if the ITC reflected in GSTR-2A is ignored?
Judgment
The Hon’ble Madras High Court ruled:
- Failure to Consider GSTR-2A
- The tax authorities did not review the bill of entry or ITC reflected in GSTR-2A before issuing the order.
- This failure undermines the validity of the assessment.
- Reassessment of Tax Demand
- The court directed the State Tax Officer to reassess the tax liability after considering the GSTR-2A entries.
- Setting Aside the Order
- The court set aside the impugned order and remitted the case for reconsideration based on the available GSTR-2A data.
Key Takeaways
- Importance of GSTR-2A
- The judgment highlights the significance of GSTR-2A data in validating tax assessments.
- Right to Reassessment
- Taxpayers can request reassessment if authorities overlook legitimate ITC claims during adjudication.
This ruling reinforces the need for tax authorities to thoroughly evaluate all relevant records, including GSTR-2A, before finalizing tax orders.
